BMW is hitting new sales records and doing rather well thank you in spite of the criticisms in recent years from some quarters of the ‘radical’ designs of models that have emerged under the guidance of design director Chris Bangle. But the new 3 Series (E90) follows a much less controversial path, says Dave Leggett.
Go deeper with GlobalData
After the controversy BMW wrought on its apparently rather conservative customer base with the ‘radical’ looking 5 and 7 Series saloons, the new 3 Series (E90) is an altogether more cautious styling proposition that suggests evolution rather than revolution. And, according to remarks recently made by Chris Bangle, it marks the end of the design cycle that began with the 7 Series in 2001.
The new 3’s lines certainly do have something in common with its bigger siblings, but they are softer and perhaps more respectful of the easy elegance and appeal of the hugely successful previous generation 3 Series (E46). That ought to mean that there is less chance of alienating the traditional BMW 3 customers who the company will want to see graduating to the larger and more expensive models, as they get older and richer.
Most of the journalists who were with me at the media launch in Spain agreed that the low-risk strategy appeared to make good business sense, especially given the position of the 3 Series in its very competitive market segment and the 3 Series range’s history as BMW’s hugely successful high-volume entry-level model.
Pesky exchange rate losses and change resistant customers aside, these are good times for BMW – both the group and the brand. Sales are hitting new records and we’ll find out more about BMW AG’s record revenues and profits at the annual results conference in Munich on March 16th.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataFor BMW, hitting the landmark one million total units sold (1,023,575 to be precise, some 10.3% up on the previous year) under the BMW brand globally last year, illustrated the impact of incremental volume growth via the addition of new products and the entering of new segments. In 2004 alone, BMW added the 1 Series, 6 Series and X3 models to its line-up.
But the 3 Series remains BMW’s highest selling model and is at the core of its brand image.
BMW CEO Dr Helmut Panke, speaking in Geneva recently on the occasion of the BMW Group Press Evening, summed it up: “The BMW 3 Series naturally still plays a special role within our core model series. Most recently – in the 2004 business year – the BMW 3 Series contributed to around 44 percent of total retail of the BMW brand. It is therefore currently the strongest selling model series in the product portfolio of the BMW Group overall. In 2004 we sold around 450,000 vehicles of the BMW 3 Series. More than half of them – over 235,000 vehicles, were sedans.”
 |
| 3 Series built on this original concept: BMW 1600-2 (1966) |
Evolution not revolution
The first 3 Series Saloon (E21) was launched in 1975, based on the two-door BMW 1600-2 and its successor 2002 models of the late-1960s and early-1970s. Three further generations of 3 Series have followed, launched in 1982 (E30), 1990 (E36) and 1998 (E46). An evolutionary approach to each 3 Series generation’s design is apparent and the new 3 is no exception. Each model, even the relatively bold ones such as the E36, displays elements of continuity of design with its predecessor.
The fifth generation E90 is no exception. Moreover, it arrives without the prominent high boot lid which yielded the rather bulbous rear-end look that has proved so controversial on the 7 Series and to a lesser extent the 5. But the distinguishing convex and concave Bangle ‘flame surfacing’ is present on the new 3, though it appears relatively subdued now.
Dutch designer Adrian van Hooydonk, General Manager BMW Design, sums up the company view on where the 3 Series aesthetic sits within the BMW family: “The 3 Series is the cornerstone of the ‘sport’ component of the brand. How do we ensure its sports and saloon design briefs are met? We have to introduce design features that reflect the car’s engineering, which is a given with a 3 Series, remind owners of classic BMW design features, and link this car with its family, particularly the sporty members, the Z4, and 1 Series.
“Another key consideration is providing the basis for future 3 Series derivatives such as Convertible, Coupé and M3. That’s a great opportunity. With such styles coming over the horizon, the saloon naturally evolved with a sporty and dynamic look.”
“So, from the front, the car looks pretty aggressive and sporty. The headlamps have a stretched, angular and cut-off shape, whilst the strong form lines that link the wing mirrors to the bonnet, headlamps and, ultimately, the very low front air intake, produce an exaggerated V form for the power dome. The wing mirrors themselves have been designed to reduce wind noise, producing a distinct horizontal crease that catches light and shadow. Completing the dramatic front view are the flared wheel arches that flow as one into the front bumper. Along the side, the dipping coupé-like roofline counter-balances a rising taper on the lower valance. These lines converge above and below the rear axle, directing the eye to the rear wheel, and the driving force.”
iDrive’s u mad
Besides the relatively inoffensive play-safe external styling, other areas of the new 3 Series also suggest the prevalence lately in Munich of the low-risk strategy. The still controversial iDrive electronics control system (grouping together navigation, communication, entertainment and climate control menus), with its single dial controller, is not standard equipment if buyers do not opt for the DVD navigation system (navigation automatically brings iDrive with it).
BMW executives acknowledge that ‘ease of use’ remains an issue with iDrive, although they also insist that they are continuing to improve that aspect, with more improvements to come. The alternative, they say, would be the proliferation of electronic functions switchgear and iDrive is a consolidation solution that they like, though they acknowledge that it is not perfect. Hmm.
Just for the record, I found using iDrive hard going to begin with (please, I just want to turn the radio on!). Its ‘unintuitiveness’ (if such a word exists) requires quite a bit more mental effort than is usual on the part of the user getting to grips with the controls of an unfamiliar car. That said, I would also expect that most people could pick it up reasonably quickly.
Bigger but lighter
BMW claims a number of significant improvements for the new 3 Series over the outgoing E46 range, including larger dimensions to expand interior space (notably in the rear of the car, where limited space has been a source of criticism before) and the use of lighter metals in some areas to make the car lighter.
The new 3 Series’ width has increased by 78mm (excluding wing mirrors) and its length by 49mm. The increase in length is biased towards stretching the wheelbase rather than overhangs (for sports handling reasons), with wheelbase increasing by 35mm and front and rear overhangs by a combined 14 mm. Height has been increased by 6mm and boot (trunk) space by 20 litres from 440 to 460 litres. 40 per cent of the overall increase in dimensions contributes to extra leg room, 40 per cent to extra luggage space and the remaining 20 per cent to improvements in the car’s safety performance, the company says.
But even with the bigger dimensions of a larger body, increased standard specification, more safety features and improved crash protection, weight has been reduced on the new model. BMW puts this down to a number of factors including the inclusion of aluminium front suspension, lighter steel for body panels, the loss of the spare wheel (run-flat tyres are standard) and the introduction of lighter plastics and materials generally as well as some innovations specific to certain models – such as the aluminium/magnesium engine in the 330i.
BMW claims that in the case of the new 320i saloon, its increased dimensions and extra specification add 104kg on paper, but this is more than cancelled out by a weight removal of 124kg, resulting in a car that, at 1310 kg, is 20kg overall lighter than its predecessor with the added benefits of its larger size and increased specification.
Variant rollout staggered
The new 3 Series is launched with three engines: the six-cylinder petrol unit recently unveiled in the 630i for the 330i and two new four-cylinder engines, already installed in the 1 Series, for the 320i and 320d. A further six-cylinder option arrives in the spring (April in UK) with the addition of the 325i to the line-up. Later in the year, 318i, 318d and 330d saloons arrive, but existing 3 Series Coupe, Touring and Convertible models will continue ‘for the time being’ prior to replacement (that is standard practice, expect to see the Touring first – probably 2006 H1 – and the Convertible last).
The Hams Hall produced 2.0-litre four-cylinder engine in the 320i delivers 150bhp and is the most powerful four-cylinder petrol ever to grace a non-M BMW. But the four-cylinder diesel unit in the 320d tops it, delivering some 163bhp and supporting the company’s ‘performance diesel’ tag.
The magnesium and aluminium six-cylinder engine in the 330i develops 258bhp. Being 30 per cent lighter than aluminium, the use of magnesium makes this engine the lightest volume-production six-cylinder engine, BMW claims. Weighing just 121kgs, the 3.0-litre straight-six engine’s power output is up 12 per cent compared with the outgoing 3-litre unit, with fuel consumption down by the same amount. The crankcase as well as the crankshaft bearings and the cylinder head cover are all made of magnesium.
In 2005, the four-cylinder 320d and 320i launch models are expected by BMW to account for around 45 and 35 per cent of sales (UK market figures) respectively, with the six-cylinder 330i taking about ten per cent. The 325i that is due to be launched in April is expected to account for a further ten per cent. The introduction later in the year of four-cylinder 318i and 318d models and the six-cylinder diesel 330d will make a small impact on these figures and in a full year will take around five per cent each, BMW says.
Volumes
Historically, each generation of the 3 Series has outsold its predecessor as model variants have been added (beginning with the 4-door as late as 1983, then adding a diesel and a convertible in ’85, estate/wagon came along in ‘87) and market demand has steadily grown. By the time of its replacement in 1998, the third generation (E36) of the 3 Series, despite its shorter lifecycle, was able to successfully outsell its predecessor (E30), with 2.7 million units built. The fourth generation E46 managed to exceed E36 with over three million units cumulative by the end of 2004.
In 2004, the E46’s last full production year, some 449,670 3 Series vehicles were sold globally, a figure that is down 14.9% on the previous year but still highly respectable on an outgoing model. Of that total approximately 265,000 units were sold in western Europe and some 107,000 units were sold in the US.
Western Europe, North America and Japan combined account for close to 90% of 3 Series total sales, but the ‘rest of world’ proportion is now growing with BMW expanding its presence around the globe in places such as China, Thailand and Russia. BMW operates CKD production plants and joint ventures in car production in Thailand, Indonesia, Malaysia, Egypt, and Russia, the new model being destined for assembly in these countries.
3 Series sales in China have been hit lately by slower demand for luxury cars there, although long-term prospects are very positive and production capacity at the Brilliance joint venture plant is being expanded to 30,000 units a year (with output being a mix of 3 Series and 5 Series models). Reports in the media, citing Brilliance JV sources, have suggested that overall capacity at the plant could be 100,000 units a year by 2010. A plant in India is a further possibility and the E90 3 Series could be expected to be in the running for a slice of the planned production.
A second plant in the US to make the 3 Series (made at Spartanburg for a while in the mid-1990s) is also a possibility on cost grounds as BMW seeks to reduce the adverse impact of the weak dollar on its profitability. While the company is saying that such a move is not planned, preferring to attack its cost base, another big negative currency charge in 2005 would undoubtedly increase the pressure for such a step.
Manufacturing efficiency raised
BMW claims that the new 3 Series is also accompanied by a number of manufacturing efficiency enhancements. Most obviously, it shares platform and much componentry with the 1 Series, which cuts company costs. But in addition, all derivatives of the new BMW 3 Series share one and the same identical front body section – and this, the company says, is quite sufficient to meet all customer demands.
On the former model there were three different body sections at the front, and on the generation before no less than thirty different front sections. The end result is that the number of job processes and variants on the main line is much reduced and it is claimed that the highly flexible production structures facilitated extend between plants as well as in the plant itself.
The production network
Production of the new BMW 3 Series this year will commence at the four BMW plants in Munich, Regensburg, Leipzig, and Rosslyn (South Africa), with Shenyang (Brilliance JV) in China following ‘somewhat later’. These plants will build different variants of the new 3 Series and in some cases additional models in other series.
But the new BMW 3 Series will be built first at the Munich Plant, its spiritual home, which will specialise in the 3 Series saloon variant.
Regensburg, which also makes the closely related 1 Series, will make the new 3 Series saloon, as well as the coupé and convertible versions of the former model including the BMW M3 in a single-line system, that is on one main assembly line.
Beginning in the spring of 2005, the new BMW 3 Series will also be built at BMW’s new plant in Leipzig. Using flexible working time concepts, BMW says that its Leipzig Plant is able to build cars between 60 and 140 hours a week, responding flexibly to market demands.
South Africa’s Rosslyn plant largely serves the US market plus RHD markets including Japan, and sub-Saharan Africa.
Viewpoint
The new BMW 3 Series is undeniably a good job on lots of levels and will undoubtedly get good consumer/enthusiast press reviews and appeal to its target market. But just how important is this new 3 Series for BMW? It is still, as a premium sports saloon and given its heritage, at the core of what the BMW brand is all about. But BMW now has a lot of models and will, as it readily admits, be less reliant on the 3 in future. One question for the marketing people in Munich is how the perception of the brand will be changing as it enters new segments. Will the brand be diluted? How far does BMW want to go in the quest for additional volume?
And the competition for the executive segment, where the 3 Series sits, is more intense than ever: consumers are being faced with yet more choice – brands, models, vehicle concepts – at any given price point. Indeed, a BMW ‘crossover’ is also planned for 2008 to further add to BMW’s already much filled out product portfolio. At some point the potential for incremental sales growth starts to wane, surely. There are only so many sales to be had out there. Crikey, this could well be the first 3 Series generation that, however good it is, does not – shock, horror – actually add cumulative sales ahead of its predecessor generation (at least in Western Europe and North America, though China could swing it the other way a few years out). In the internal BMW E90 versus E46 contest, it could be tight. There’s a thought.
But here’s another one. Alternatively, will consumers continue, as they have been doing lately, to gravitate towards premium brands and away from volume brands? If the developed world carries on getting richer (for all the occasional world economy hiccups or places, like Germany and Japan, where economic growth has at times been muted, that is one of the big global stories of the past twenty-five years) BMW is a brand that will surely be a beneficiary, a ‘designer brand’ that can carry a decent premium in the marketplace. Also, those big-potential emerging markets need their aspirational brands and models too (‘my next car won’t be a Chery QQ – and the one after that will be a BMW!’).
Last year, at the end of its model cycle, the 3 Series still accounted for 44% of overall BMW brand sales in unit terms. And it enjoys hefty margins. Even if the 3 Series is less important for BMW these days, it is still massively important to the company
And that is why, of course, they didn’t mess around with E90.
